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Australian Stock Market Report - Morning - 12/12/2011

Data and analyses gathered from different investment analysts have shown a positive start for the local stock markets in spite the disappointing finish in last Friday's session.

Commsec said in its Friday commentary on closing "the Australian sharemarket with the All Ordinaries index (XAO) down 1.7 pct or 74.8 pts to 4264.1. There was weakness across the board today with the miners the biggest losers, down by more than 2 pct. Thanks to a positive start to trade on Monday, shares pulled back by only 1.87 pct this week."

Nonetheless, there is some resilience seen on Monday's opening trading.

Accoridng to Ric Spooner, chief market analyst, CMC Markets, "the Australian market is expected to follow international markets with a positive opening in response to European leaders' announcement of a fiscal compact for the 17 Eurozone nations."

Ben Le Brun, analyst from OptionsXpress said in another commentary that "that the summit, while not a being a silver bullet for markets, was taken as being a step in the right direction with all 17 Eurozone nations agreeing to a fiscal compact on sustainable public finances and penalties for rule breakers.

He said "the Australian share market could be pointed higher on more than one front this morning as we had the opportunity to price in comments made by EU leaders late on Friday and our initial reaction was negative, with the ASX200 posting a 1.7% decline to end the week."

Le Brun also pointed out the "better than expected economic data out of China with the inflation rate dropping more than expected on Friday, which has not been taken in by the domestic markets as the focus then was the EU summit.

He noted this positive news from China will have a good impact on the resources and mining companies listed on the ASX.

"We will possibly see more easing of monetary policy out of Beijing. Retail sales data released after hours on Friday also showed that domestic consumption is alive and well in China. This has been a major focal point for the PBOC especially considering the European situation," Le Brun added.

On Monday, Australia expects to see the economic data from ABS on housing finances data for October and international trade in goods and services.

While this week will see three out of the big four banks hold AGMs. It is also a busy week for economic data out of the US and hopefully the market will refocus on the improving conditions in the US economy. The FOMC meeting on Tuesday will again be analysed for a dialogue about a future QE3 package.

Market Price at 8:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 1.0200 0.0072 0.71%
ASX (cash) 4272 69 1.64%
US DOW (cash) 12214 178 1.48%
US S&P (cash) 1260.0 22 1.78%
UK FTSE (cash) 5565 104 1.90%
German DAX (cash) 6034 201 3.45%
Japan 225 (cash) 8660 126 1.48%
Rio Tinto Plc (London) 32.46 0.30 0.93%
BHP Billiton Plc (London) 19.61 0.27 1.40%
BHP Billiton Ltd. ADR (US) ( AUD ) 36.72 0.86 2.40%
US Light Crude Oil (Jan) 99.83 1.71 1.74%
Gold (spot) 1711.0 1 0.06%
Aluminium (London) 2065.00 0 0.00%
Copper (London) 7815.00 105 1.36%
Nickel (London) 18600.00 300 1.64%
Zinc (London) 2003.00 18 0.91%
RBA Cash Rate to be decreased by 25bp (Feb) (%) 55.00 0 0.00%

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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